The Savannah Bancorp, Inc. (NasdaqNM: SAVB) reports that net income
for the third quarter 2005 was $2,354,000, up 52 percent from
$1,544,000 in the third quarter 2004. Net income per diluted share
was 53 cents compared to 37 cents per diluted share in the third
quarter of 2004, an increase of 44 percent. For the third quarter
2005, return on average equity was 19.16 percent, return on average
assets was 1.34 percent and the efficiency ratio was 51.43 percent.
For the first nine months of 2005, net income was $6,319,000, a 60
percent increase over $3,961,000 in the first nine months of 2004.
Earnings per diluted share for the first nine months of 2005 were
$1.46, an increase of 55 percent over earnings per diluted share of
$0.94 over the same period in 2004. For the first nine months of
2005, return on average equity was 19.20 percent, return on average
assets was 1.25 percent and the efficiency ratio was 52.88 percent.
Prior year per share amounts have been restated to reflect the
effect of a 5-for-4 stock split distributed in the form of a 25
percent stock dividend in December 2004. Net interest income
increased $1,868,000, or 35 percent, in the third quarter 2005 over
the same period in 2004. Earning assets growth of 22 percent and
eleven consecutive prime rate increases of 25 basis points each
over the prior 15 months resulted in significantly higher net
interest margins for the third quarter and the first nine months of
2005. The Company's efficiency ratio improved due to increased
revenues being realized from investments made in previous years in
markets, personnel and technology and the positive impact of rising
rates on net interest income. Loans, excluding loans held for sale,
totaled $602 million at September 30, 2005, compared with $471
million one year earlier, an increase of 28 percent. Deposits
totaled $603 million at September 30, 2005 and $466 million at
September 30, 2004, an increase of 30 percent. As of September 30,
2005, demand, savings and money market accounts increased 24
percent over the prior year as a result of continued focus on core
deposit growth. Total assets increased 23 percent to $713 million
at September 30, 2005, up from $580 million a year earlier.
Nonperforming assets increased to $1,965,000, or 0.33 percent of
total loans and other real estate owned at September 30, 2005 from
$733,000, or 0.12 percent at June 30, 2005 and $631,000, or 0.13
percent of total loans, at September 30, 2004. Net loan losses for
the first nine months of 2005 were $8,000. The provision for credit
losses was $1,195,000 for the first nine months of 2005 and 2004.
The increase in nonperforming loans primarily relates to isolated
specific circumstances impacting a few borrowers and is not
indicative of overall portfolio concerns. No significant losses are
anticipated on these loans. At September 30, 2005, Harbourside
Mortgage Company, a division of The Savannah Bank, N.A., had total
loans and loans held for sale of $116 million, up $48 million from
a year earlier. Harbourside's earnings for the third quarter of
2005 were $269,000 and they were $747,000 for the first nine months
of 2005. This compares with third quarter 2004 earnings of $46,000
and a loss of $34,000 for the first nine months of 2004. Other
significant events during the third quarter included: -- Completion
of the private placement of 397,273 shares of common stock for net
proceeds of $11.6 million on August 30, 2005. -- Purchase of 50
percent interest in the Company's main office building at 25 Bull
Street and the adjacent parking lot. -- Sterne, Agee and Leach,
Inc. initiated analyst coverage on the Company on September 30,
2005. -- The regulatory approval process and construction of the
main office building for Harbourside Community Bank, a federal
stock savings bank being formed by the Company on Hilton Head
Island, SC, are progressing. G. Mike Odom, Jr., Chief Executive
Officer, and John C. Helmken II, President, stated, "We are very
pleased with the growth in assets, earnings and shareholder value
during the third quarter and the first nine months of 2005. Our
dedicated staff is very focused on serving our existing customers
and developing new, profitable relationship opportunities which our
growing markets continue to provide." Today, the Board of Directors
approved a regular quarterly cash dividend of 13.5 cents per share
payable on November 21, 2005 to shareholders of record on October
28, 2005. The Savannah Bancorp, Inc. (SAVB), a bank holding company
for The Savannah Bank, N.A. and Bryan Bank & Trust (Richmond
Hill, GA), is headquartered in Savannah, GA. Harbourside Mortgage
Company, a division of The Savannah Bank, N.A., is a loan
production office on Hilton Head Island, SC that began business on
October 1, 2003. SAVB began operations in 1990. Its primary
businesses include deposit, credit, trust and mortgage origination
services provided to local customers. This press release may
contain forward-looking statements as defined by federal securities
law which involve significant risks and uncertainties. Actual
results could differ materially from those contained in or implied
by such statements for a variety of reasons including, but not
limited to: changes in interest rates; changes in accounting
principles, policies, or guidelines; significant changes in the
economic scenario: significant changes in regulatory requirements;
and significant changes in securities markets. The Savannah
Bancorp, Inc. does not undertake to update forward-looking
statements to reflect circumstances or events that occur after the
date the forward-looking statements are made. Any such statements
are made in reliance on the safe harbor protections provided under
the Private Securities Act of 1995. -0- *T The Savannah Bancorp,
Inc. and Subsidiaries Third Quarter Financial Highlights September
30, 2005 and 2004 (Unaudited) ( thousands, except per share data)
Balance Sheet Data % at September 30 2005 2004 Change
----------------------------------------------------------------------
Total assets $713,082 $580,016 23 Interest-earning assets 678,974
556,075 22 Loans 601,554 471,300 28 Allowance for loan losses 7,576
6,180 23 Non-accruing loans 1,113 112 894 Loans past due 90 days
& accruing 852 19 - Other real estate owned - 500 0 Deposits
603,303 465,587 30 Interest-bearing liabilities 556,550 462,461 20
Shareholders' equity 56,696 39,016 45 Allowance for possible loan
losses to total loans 1.26% 1.31% (3.9) Nonperforming loans to
total loans and other real estate owned 0.33% 0.13% 144 Loan to
deposit ratio 99.71% 101% (1.5) Equity to assets 7.95% 6.73% 18
Tier 1 capital to risk-weighted assets 11.42% 10.56% 8.1 Total
capital to risk-weighted assets 12.67% 11.81% 7.3 Book value per
share $ 12.35 $ 9.49 30 Outstanding shares 4,591 4,113 12 Market
value per share $ 34.50 $ 22.16 56 Performance Ratios
----------------------------------------------------------------------
% For the Third Quarter 2005 2004 Change
----------------------------------------------------------------------
Net income $ 2,354 $ 1,544 52 Return on average assets 1.34% 1.06%
26 Return on average equity 19.16% 15.96% 20 Net interest margin
4.28% 3.82% 12 Efficiency ratio 51.43% 58.51% (12) Per share data:
Net income - basic $ 0.54 $ 0.38 44 Net income - diluted $ 0.53 $
0.37 44 Dividends $ 0.135 $ 0.132 2.3 Average shares: Basic 4,346
4,113 5.7 Diluted 4,467 4,204 6.3 % For the First Nine Months 2005
2004 Change
----------------------------------------------------------------------
Net income $ 6,319 $ 3,961 60 Return on average assets 1.25% .98%
28 Return on average equity 19.20% 14.01% 37 Net interest margin
4.17% 3.79% 10 Efficiency ratio 52.88% 59.45% (11) Per share data:
Net income - basic $ 1.50 $ 0.97 55 Net income - diluted $ 1.46 $
0.94 55 Dividends $ 0.405 $ 0.392 3.3 Average shares: Basic 4,224
4,108 2.8 Diluted 4,340 4,205 3.2 *T -0- *T The Savannah Bancorp,
Inc. and Subsidiaries Consolidated Balance Sheets September 30,
2005 and 2004 (Unaudited) (thousands, except share data)
----------------------------------------------------------------------
September 30
----------------------------------------------------------------------
2005 2004
----------------------------------------------------------------------
ASSETS Cash and due from banks $ 16,918 $ 11,274 Interest-bearing
deposits 13,827 9,876 Federal funds sold 9,791 9,145 Investment
securities, available for sale 41,206 40,932 Loans held for sale
13,536 25,517 Loans, net of allowance for credit losses of $7,576
in 2005 and $6,180 in 2004 593,978 465,120 Premises and equipment,
net 4,727 4,741 Investment in real estate partnership 2,669 - Other
real estate owned - 500 Bank-owned life insurance 5,497 5,302 Other
assets 10,933 7,609
----------------------------------------------------------------------
Total assets $713,082 $580,016
======================================================================
LIABILITIES Deposits: Noninterest-bearing $ 94,867 $ 74,231
Interest-bearing demand 90,502 81,917 Savings 19,637 19,319 Money
market accounts 111,625 79,418 Time deposits 286,672 210,702
----------------------------------------------------------------------
Total deposits 603,303 465,587 Securities sold under repurchase
agreements 15,049 19,375 Other short-term borrowings 2,178 20,483
FHLB long-term advances 20,577 20,937 Subordinated debt 10,310
10,310 Other liabilities 4,969 4,308
----------------------------------------------------------------------
Total liabilities 656,386 541,000
----------------------------------------------------------------------
SHAREHOLDERS' EQUITY Common stock, par value $1 per share:
authorized 79,860,000 shares; issued 4,591,339 and 3,290,223 in
2005 and 2004 4,591 3,290 Preferred stock, par value $1: authorized
10,000,000 shares - - Capital surplus 36,269 25,054 Retained
earnings 16,171 10,315 Treasury stock, at cost, 267 and 226 shares
in 2005 and 2004 (4) (4) Net unrealized (losses) gains on available
for sale securities (331) 361
----------------------------------------------------------------------
Total shareholders' equity 56,696 39,016
----------------------------------------------------------------------
Total liabilities and shareholders' equity $713,082 $580,016
======================================================================
*T -0- *T The Savannah Bancorp, Inc. and Subsidiaries Consolidated
Statements of Income Third Quarter and First Nine Months, 2005 and
2004 (Unaudited)
----------------------------------------------------------------------
(thousands, except per share data) For the For the Quarter Ended
Nine Months Ended September 30, September 30,
----------------------------------------------------------------------
2005 2004 2005 2004
----------------------------------------------------------------------
Interest income $11,050 $7,511 $30,425 $20,422 Interest expense
3,901 2,230 10,464 5,906
----------------------------------------------------------------------
Net Interest Income 7,149 5,281 19,961 14,516 Provision for credit
losses 375 320 1,195 1,195
----------------------------------------------------------------------
Net interest income after provision for credit losses 6,774 4,961
18,766 13,321
----------------------------------------------------------------------
Noninterest Income Service charges on deposit accounts 402 423
1,216 1,214 Mortgage related income, net 260 255 790 730 Trust fees
125 110 358 324 Gain (loss) on sale of other real estate owned, net
18 0 (6) 91 Other income 288 241 777 650
----------------------------------------------------------------------
Total noninterest income 1,093 1,029 3,135 3,009
----------------------------------------------------------------------
Noninterest Expense Salaries and employee benefits 2,422 2,139
7,056 6,100 Occupancy and equipment expense 580 473 1,643 1,379
Data processing expense 317 267 916 792 Other operating expenses
920 813 2,599 2,148
----------------------------------------------------------------------
Total noninterest expense 4,239 3,692 12,214 10,419
----------------------------------------------------------------------
Income before provision for income taxes 3,628 2,298 9,687 5,911
Provision for income taxes 1,274 754 3,368 1,950
----------------------------------------------------------------------
Net Income $ 2,354 $1,544 $ 6,319 $ 3,961
======================================================================
Per Share: Net income - basic $ 0.54 $ 0.38 $ 1.50 $ 0.97
======================================================================
Net income - diluted $ 0.53 $ 0.37 $ 1.46 $ 0.94
======================================================================
*T -0- *T The Savannah Bancorp, Inc. and Subsidiaries Historical
Trend Data - Five Years and Five Quarters
----------------------------------------------------------------------
The following tables show per share information for the most recent
five years and five quarters. Share and per share information have
been restated to reflect the effect of a 5-for-4 stock split with a
distribution date of December 20, 2004. (thousands, except share
data) For the Most Recent Five Years ------------------------------
2004 2003 2002 2001 2000 -------- -------- -------- --------
-------- Net income $ 5,736 $ 4,644 $ 4,508 $ 4,358 $ 4,292 Average
shares Basic 4,109 4,103 4,100 4,068 4,090 Diluted 4,209 4,181
4,160 4,140 4,156 Net income per share ($) Basic 1.40 1.13 1.10
1.07 1.05 Diluted 1.36 1.11 1.08 1.05 1.03 Dividends per share 0.52
0.51 0.49 0.45 0.38 Market price per common share ($) High $ 27.60
$ 23.20 $ 17.68 $ 18.18 $ 14.38 Low 20.14 15.18 14.18 12.40 11.24
Close 27.05 23.20 15.25 14.84 12.73 At December 31 ($) Assets
617,341 476,865 437,598 376,183 344,096 Shareholders' equity 40,071
36,771 34,756 32,071 28,656 Book value per share 9.74 8.96 8.48
7.86 7.03 Outstanding shares 4,112 4,103 4,101 4,079 4,076 Key
Ratios (%) Return on equity 15.04 12.99 13.50 14.27 16.23 Return on
assets 1.03 1.05 1.14 1.20 1.36 Net interest margin 3.86 3.91 4.10
4.13 4.77 Efficiency ratio 58.47 59.40 59.17 57.11 56.04 For the
Most Recent Five Quarters (Unaudited)
---------------------------------- 2005 2004
--------------------------------------------- Third Second First
Fourth Third Quarter Quarter Quarter Quarter Quarter
--------------------------------------------- Net income $ 2,354 $
2,184 $ 1,781 $ 1,775 $ 1,544 Average shares Basic 4,346 4,177
4,153 4,112 4,113 Diluted 4,467 4,275 4,259 4,225 4,204 Net income
per share ($) Basic 0.542 0.523 0.429 0.432 0.375 Diluted 0.527
0.511 0.418 0.420 0.367 Dividends per share 0.135 0.135 0.135 0.132
0.132 Market price per common share ($) High 34.50 33.46 28.85
27.60 22.60 Low 30.27 27.00 24.01 21.99 20.14 Close 34.50 30.95
28.85 27.05 22.16 At quarter-end ($) Assets 713,082 689,271 673,252
617,341 580,016 Shareholders' equity 56,696 43,619 41,369 40,071
39,016 Book value per share 12.35 10.40 9.96 9.74 9.49 Outstanding
shares 4,591 4,194 4,153 4,112 4,113 Performance ratios (%) Return
on equity 19.16 20.51 17.71 17.84 15.96 Return on assets 1.34 1.29
1.12 1.16 1.06 Net interest margin 4.28 4.16 4.08 4.00 3.82
Efficiency ratio 51.43 52.20 55.30 55.94 58.51 Additional financial
highlights are available at www.savb.com *T
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